The NYT’s Geffen Put

By Felix Salmon
May 26, 2009

Peter Kafka delves behind the New Yorker’s firewall today to look at the relationship between David Geffen and the New York Times, as reported by Lawrence Wright. The upshot is that if you’re worried about the future of the NYT, don’t be — the Sulzbergers can take all the risks they want, because they know that if it all goes horribly pear-shaped, the Geffen Put will always be there:

If the Times ever does need a deep-pocketed buyer, Geffen has made it very clear he’s available.

This is good news for all concerned, I think. The option to sell to Geffen has real value to the Sulzbergers even if they never exercise it — it essentially gets rid of the worst-case-scenario of an LA Times-style death spiral where the newspaper is owned by a for-profit owner who has no idea what he’s doing nor any respect for sacred trusts and the like.

Meanwhile, Ryan Chittum tweets that an annual subscription to the dead-tree NYT is now $811 a year. Which means that if you’re earning the $45,000 median income for New York City and you subscribe to the NYT, almost 2% of your pre-tax income is spent on your newspaper. I’d love to see a chart of the NYT’s subscription cost as a ratio of NYC median income — has it ever been this high? And what’s a realistic upper bound for that figure?

Update: Ryan now says the cost isn’t $811 but rather $770. That’s still $59.23 every four weeks, which is a 40% hike from the $42.40 which I’m currently paying; it definitely approaches the point at which only the cost-insensitive won’t think about unsubscribing.

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